Zimbabwe trims down MSMEs financial exclusion
Entrepreneurs follow proceedings during the commemoration of Macro Small and Medium Enterprises (MSMEs) International Day at Zimbabwe International Exhibition Centre in Bulawayo yesterday
Sikhulekelani Moyo and Njabulo Nkomo, Business Reporters
ENHANCED collaboration between the Reserve Bank of Zimbabwe (RBZ) and the Ministry of Women Affairs, Community, Small and Medium Enterprises (SMEs) Development has narrowed the level of financial exclusion in the sector to three percent from 43 percent in the past 10 years, a Cabinet Minister has said.
Guided by the National Financial Inclusion Strategy (NFIS), whose first phase was launched in 2016 and ran up to 2021, Zimbabwe is implementing policies that seek to promote inclusive economic development.
The country has one of the largest informal sector bases in the region hence the launch of the National Financial Inclusion Strategy (NFIS II) is critical in enhancing SMEs sector’s access to finance.
Many SMEs are now able to access finance from different financial institutions with minimal requirements which was not the case in the past.
This is in line with the 2023 National Budget statement, which stresses the need to spread financial services, particularly to targeted groups such as women, youth, SMEs, rural communities, smallholder farmers, people with disabilities (PWDs) as well as pensioners and the elderly.
Officiating at the Macro, Small and Medium Enterprises (MSMEs) International commemoration day in Bulawayo yesterday, Minister of Women Affairs, Community, Small and Medium Enterprises Development, Dr Sithembiso Nyoni, said despite the huge contributions made by the SMES, most young businesses are still saddled by numerous challenges such as access to finance, antiquated technologies and aging equipment, high costs of utilities and interrupted supplies as well as high costs of doing business.
“Under the National Financial Inclusion Strategy, the Ministry in collaboration with RBZ has implemented a number of initiatives aimed at improving MSME’s financial inclusion,” said Dr Nyoni. She said this had seen a huge decrease in the financially excluded MSMEs from 43 percent in 2012 to three percent in 2022.
“The recently launched Collateral Registry System is expected to facilitate further easy access to credit and encourage economic activity and stimulate growth in the sector,” said Dr Nyoni.
The event was held under the theme: “Galvanizing MSMES Worldwide by Supporting Women and Youth Entrepreneurship and Resilient Supply Chains”.
Dr Nyoni said Government will continue to work with formal banking institutions and digital financial services providers in deepening financial inclusion anchored on the strengthened credit information infrastructure.
Minister Sithembiso Nyoni International MSMEs Day
She said MSMEs were making significant contributions to economic growth and sustainable development worldwide including in Zimbabwe. “The sector is contributing significantly to employment creation, wealth creation and poverty reduction,” said Minister Nyoni.
According to the 2021 MSME Survey, there are 3,4 million MSMEs operating in Zimbabwe with the sector employing about 4,8 million people on a full-time basis.
The 2022 Finscope Survey indicated that the sector contributed US$8,6 billion to the Gross Domestic Product that year.
“Let me point out that of the 4,8 million full-time employees in the sector, women constituted the majority at 52,1 percent. This position dovetails with the Government’s thrust of delivering broad-based transformation, new wealth creation and expanding horizons of economic opportunities for all leaving no one and no place behind,” said Dr Nyoni.
She said her ministry was working closely with local authorities to provide decent workspaces for the MSMEs.
In her remarks, Bulawayo Minister of State for Provincial Affairs and Devolution Judith Ncube said numerous shocks were crippling MSMEs operations hence the need to come up with policies that strengthen capacity and support the sector to develop.-chronicles
